In response to a few comments…

My good friend, Fey, posed a few questions and ideas in her comment on my previous post about saving for an emergency fund that I wanted to highlight and talk through a little of my decision-making process on this. I’m happy to have suggestions like this and open this blog up to more back and forth. 

 Its good you are saving for your emergency fund. But unless your credit card debt is on a 0% interest card, wouldn’t it be better to pay off high-interest credit cards first before starting an emergency fund?

Example: If your savings was earning 5% APR while your credit cards are charging you 15% then that would be 10% you are loosing dollar for dollar that’s sitting in your savings account……

I totally agree with you, here, that the key is paying off the high interest card debt. But without the emergency fund to tap in to when the car inevitably needs a new timing belt or I need to call the plumber out to unclog a drain I can’t manage — I’m afraid of resorting back to those cards to cover these emergencies.

While keeping $1000 in a savings account that doesn’t earn nearly enough in comparison to the interest charged on that $1000 of debt that could be paid off sooner may not be the most aggressive debt reduction strategy — I think for me the psychology and feeling of being covered in an emergency outweighs the cost of the extra $$ I’ll be paying on that $1000 of debt.

For xmas have you thought of a secret santa gift exchange between the adults? I know you have lots of family members…And for the kids (mine and everyone elses) I write up a budget and decided how much money I will spend on each one. Then I start shopping in September and pick up things here and there with my spare money grocery money. By the time Thanksgiving rolls around I am done.

Great suggestions! I’ve also been keeping a budget over the last few years. I’ve really cut the number of “extra” people outside of my family down to few and we do focus primarily on the younger kids. Last year, my siblings and I decided to limit ourselves to $10 each, too, so we still have the fun of exchanging presents but without hitting our pocketbooks too hard. I was pleased too at how creative we all did get within that small amount.

Have you thought of getting a house mate and using the money to pay down your credit card debt. And once that is wiped out you could kick them out (if they were a pain and unlovable) or if they turned out to be cool you could then start socking away all that extra dough twoards your next financial goal……..

so if you rented a room at $200/month it would take you 7.5 years to pay down your credit card debt assuming it is not collecting interest….rent it for more?? Rent out 2 rooms? I have a friend who did this. He always had house mates till he married.

I’ve considered it renting out one of the rooms in my house. But I don’t know…I’ve been living alone for so long that I wonder if a person wasn’t either sleeping in my bed with me or a blood relative — that I could put up with a roommate. It’s food for thought, anyway, for sure.

Theres always getting a second job :p yuck

After trying out some retail last year for a weekend, I realized that I work to hard all week to then work some crappy job on my feet all weekend. But…I know I need additional income. I’ve actually found some at-home work that I will talk a bit more about later in the week.


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